August 6, 2013

Civil Forfeitures: Guilty until Proven Innocent

The sequester is not to the only law that is devastating the people of the United States. Federal and state laws allow the government to take property from people even if they have followed all the rules that they were told.

Almost one-third of all foreclosed borrowers, nearly 1.2 million people, faced these proceedings from the 11 leading financial institutions because of bank errors or banned practices, many of them intentional “mistakes.” Despite fighting these wrongful efforts to have their homes seized, over 244,000 of those borrowers eventually lost their homes.

Yet settlements for home losses hasn’t stopped the banks as they fabricate documents and illegally kick people out of their homes. Even worse, the settlements are so badly written that they allow the criminal foreclosures to continue. One of these loopholes is the banks’ “threshold error rate” of between 5 and 10 percent, allowing them to illegally taking someone’s home. That means that they can break the law up to 2 times for every 20 transactions with impunity. One company estimated 1.8 million foreclosure filings just in 2012, allowing them the right to take up to 360,000 homes with no right other than the threshold error rate. Even worse, the rate is based on the bank’s own reporting that could again conceal its illegal activities.

Massachusetts is one of 28 states allowing foreclosures without final approval from a judge, and homeowners continue to face wrongful foreclosures based on improper documents. State law requires banks to send a “right-to-cure notice” to defaulting homeowners, a document that includes who actually owns the borrower’s mortgage, who the borrower should contact, and what steps he or she must take to “cure” the default and avoid foreclosure proceedings. Attorneys found dozens of examples of erroneous or missing information in the notices. In addition, banks and lenders are flouting a state law providing struggling homeowners five months to get their repayments back on track before the lender can initiate a foreclosure.

Homes aren’t the only thing that people are losing. Law enforcement officers are using “civil forfeiture” to take cash, cars, houses, and other assets for drug enforcement even if the person has never been arrested or even charged with a crime. Criminal forfeiture requires a conviction before confiscation of property; civil forfeiture requires only a suspicion of a crime, regardless of owner’s guilt or innocence. These civil laws developed from British law in the seventeenth century. Nearly 2,000 forfeiture actions were filed in Philadelphia from 2008 to 2012 because of alleged drug offenses, sometimes very small, by children or grandchildren. Only 30 of these cases were rejected by judges.

In Johnson County (TX), an officer seized cash from an out-of-state driver who had committed no crime and gave him a receipt with no information about who seized the money or how he could get it back. Police in Virginia took church money from a legal immigrant when he was on his way to buy a property for the church. There are far more horrifying stories of the police abuse for personal gain.

Tenaha (TX) was particularly dangerous for anyone carrying money in their car. Six years ago Jennifer Boatright drove through the town with her boyfriend and two young sons on their way to buy a used car. They were pulled over, their money was taken, and the district attorney told them they could go to jail and lose their children to foster care or sign their cash over to the city with no criminal charges.

Police in Tehana (TX) took the infant of a Washington, D.C. couple while the parents were jailed for the night. They lost the $50,000 that they were taking to buy restaurant equipment. The couple was one of the original plantiffs in a class action against the town for its rampant seizures of cash from those driving through on the highway without other evidence of contraband or illegal activity.

A year ago, a class action lawsuit against the officials of Teneha and Shelby County found that cash and other valuables were taken largely from blacks and Latinos. Hundreds, if not more than a thousand, people suffered this highway robbery from the police. Not one of the people stopped and shaken down were ever arrested or even charged with a crime.

Barry Washington, the police officer responsible for much of this theft, testified that he considered the ethnicity and religion of the motorists to be factors relevant to establishing reasonable suspicion of criminal activity. Under oath, he described one of the examples as “two Puerto Ricans” who are “driving a car that has a Baptist Church symbol on the back, says First Baptist Church of New York.”

Thanks to the lawsuit, police will be required to follow rules such as videotaping all stops. The officer must give the reason for the stop as well as advising people that they can refuse a search. All property improperly taken must be returned within 30 business days, and any forfeiture must be given to non-profit organizations or used for training for police mandated by the settlement.

Because of the U.S. Supreme Court ruling against class action suits, no one could ask for money. The plaintiffs could only seek seek “declaratory and injunctive relief”—a legal finding of fact in their favor, and a reform of the forfeiture program.

Most of the money that officers get in these illegal forfeitures goes to the police or sheriff’s department with the officers often receiving bonuses for collecting the money. Despite the Civil Asset Forfeiture Reform Act of 2000, the DoJ has received an excessive number of reports that police perform these illegal actions when they are given money for doing it. The burden of proof is on the defendant if the person claims that the money was improperly taken.

Even the federal government is making money from forfeitures: last year the Department of Justice brought in $4.2 billion. To their credit, they have turned over more than $1.5 billion in forfeited assets to four hundred thousand crime victims, often in cases of corporate criminality, and used forfeiture to go after ruthless migrant smugglers, organized-crime tycoons, and endangered-species poachers, stripping them of their illicit gains.

Massachusetts, Michigan, Tennessee, Georgia, Arizona, Pennsylvania, Maryland, Texas–these are a few of the states where police abuse their power by taking personal property without any retribution. We hope that Sarah Stillman’s article in the New Yorker Magazine will be a wake-up call for the way that government allows this to happen.

Washington D.C. city council members are considering a bill to give D.C. residents the strongest protections against the abuse of civil asset forfeiture in the country. The rest of the United States needs to follow suit.